Pig Sector: BMPA Pork Supply Chain Report

British Meat Processors Association
British Meat Processors Association

The Swiss model: how to join nothing but get everything

Leaving the EU customs union and the single market was a mistake. The UK has gained very little by doing so and lost a great deal more. That is certainly the case for the meat and livestock industries where the massive increase in red tape and costly procedure has damaged trade with our major and closest market. A market where our principal competitors do not face the same costs and trade frictions. But there is little point crying over spilt milk. That flawed decision is, in most practical senses, a permanent one and the challenge now is to try to make it work.

All this said, the principal flaw with Brexit as it stands isn’t necessarily Brexit itself but how it is being pursued and what is driving it. It seems to me that, despite the claims of those that promote it, it is rather oddly not driven by a keen sense of self interest but rather by matters of dogma and principle. We were told that it would allow us the freedom to pursue our own interests rather than the common interests of the EU but, so far at least, all we have done is damage our own interests. Even the non-legacy trade deals with Australia and New Zealand are at best, of no material benefit and at worst potentially damaging to the UK agriculture sectors.

To see a country that understands the balance between principle and self interest we need look no further than Switzerland.

Let’s take a closer look at what the framework agreement with the EU requires Switzerland to do. It requires it to integrate EU legal acts that affect the bilateral agreements into the relevant agreements as quickly as possible. I stress ‘bilateral’ as the obligation to adopt applies only to the limited area of specific bilateral agreements. These agreements are managed by joint committees and if Switzerland and the EU cannot agree in these committees on which legal acts are to be adopted, an arbitral tribunal decides, which in certain cases must submit the disputed issue to the European Court of Justice; its judgment is binding for the arbitral tribunal. The EU can impose sanctions on Switzerland if it does not implement a judgment of the arbitral tribunal. The sanctions must be proportionate. At the request of one of the contracting parties, the arbitral tribunal decides whether this is the case. The key thing here is that this is a participative process and, ultimately Switzerland can decide to not implement and accept the consequences.

Beyond this, Switzerland generally adopts EU law not only insofar as it is obliged to do so by the applicable bilateral treaties, but also “autonomously” where there is no obligation. It does this primarily to facilitate access for the Swiss economy to the EU. In practice this autonomy is overridden by economic interests which means that not adopting is the exception rather than the rule so the gap between that and the obligation in bilateral agreements is not that great.

Even the requirements within the bilateral agreements are not automatic. They require the consent of the contracting parties, for which parliament is responsible in Switzerland, or possibly the people if the referendum is called. This is an important safeguard and is different from the ‘dynamic’ regulatory alignment model dismissed by the current UK government.
Bear in mind that, as things stand, the influence of EU law on UK law is far greater than in Switzerland as we were a Member State, and these laws were already adopted and remains so… thus far. If anything, our starting point is easier.

I can only urge that the Government take another look at this and act in the interests of the UK rather than to meet the aspirations of those driven by dogma. Apart from making a massive difference to our trade friction with the EU, it would largely fix the issues around the NI Protocol.

My wife summed it up elegantly when we were chatting about this. “Ah the Swiss. They join nothing and get everything.” Let’s have some of that please.

Peter Hardwick - Trade Policy Advisor, BMPA

About Peter Hardwick

Peter Hardwick is Trade Policy Adviser at the British Meat Processors Association (BMPA) and is one of the UK’s leading experts in both domestic and international trade

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In his latest article BMPA’s Trade Policy Adviser, Peter Hardwick explores how the so-called ‘Swiss model’ of trade with the EU manages to forge a relationship that brings most of the benefits of EU membership without many of the down sides.
Read it here: https://bit.ly/3H6TUbR

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